"The market's very strong and it's been a lucrative enterprise for farmers involved."

Blunt sold about two-thirds (150) of his replacement heifers last year for offshore markets, predominantly China, and is looking to sell in excess of 100 this year.

He decided to start exporting his yearlings about 18 months ago, spurred by a looming forecast drop in the dairy payout.

Exported cattle have to meet strict criteria, which involves passing a number of disease tests, proving the animals' breeding, and allowing exporters to inspect stock on the farm.

"You can't just run any bull with your herd, and the cattle have to pass multiple disease tests. It's quite a rigorous programme," Blunt said.

Federated Farmers dairy chairperson Willy Leferink said New Zealand cattle are highly regarded by Chinese farmers because of their breeding and ability to produce higher quantities of milk.

"Our cattle have a long history and we know what's successful. New Zealand has a tremendous name as being a source of safe food."

Exported dairy cattle are typically rising yearlings (between one and two-years old) and are put in calf only once they reach their destination.

Although Fonterra is not involved in the allotment being exported from Timaru, it does export a large number of cattle each year.

Spokesperson Kobus Retief said Fonterra has its own supply chain of dairy cattle for its farms in China.

Fonterra's goal is to be producing one billion litres of milk every year in China by 2018. It processes around 15 billion litres of milk each year from its New Zealand farmers - 95 per cent of which is for export.

It has two farms in the Hebei Province and another three under development.

"When complete these farms will milk about 15,000 cows and produce 150 million litres of top quality fresh milk every year," the co-operative says on its website.

Each of these farms is stocked with a combination of China-born cows bred on Fonterra's other farms and cows shipped from New Zealand.

In November, Fonterra said 4,300 cows were being shipped from New Zealand for two new dairy farms in Hebei Province.